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U.S. Oil Industry Prepares for More Challenges as Inventory Levels Keep Rising

by Krystal

The American Petroleum Institute (API) reported a 3.34 million-barrel increase in U.S. crude oil inventories for the week ending February 14. This was higher than analysts’ expectations, which predicted a 2.2-million-barrel rise.

This latest increase adds to a series of inventory builds totaling nearly 18 million barrels over the past four weeks. The previous week saw a 9-million-barrel rise.

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Earlier this week, the Department of Energy (DoE) also noted a slight uptick of 0.2 million barrels in the Strategic Petroleum Reserve (SPR) as of February 14. However, inventory levels in the SPR remain significantly lower than before the Biden Administration’s withdrawals.

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As of 3:04 pm ET, Brent crude oil was up by $0.21 (+0.28%) at $76.05 per barrel, marking a $0.90 drop from the same time last week. Meanwhile, the U.S. benchmark West Texas Intermediate (WTI) rose by $0.39 (+0.54%) to $72.24, a decrease of around $1 compared to last week.

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Gasoline inventories increased by 2.83 million barrels for the week ending February 7, reversing a 2.5 million-barrel drop from the previous week. As of last week, gasoline inventories were still 1% below the five-year average for this time of year, according to the latest data from the U.S. Energy Information Administration (EIA).

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Distillate inventories continued to decline, dropping 2.69 million barrels in the most recent week. This follows a smaller decline of 590,000 barrels in the week prior. As of February 7, distillate stocks were already about 11% below the five-year average.

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